EVALUATING THE MANDATORY ACTIVATION OF OLDER UNEMPLOYED
Author: Joost Bollens
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Abstract
In the course of May 2009 the so-called systematic approach by the VDAB (The Flemish Service for Employment and Vocational Training or the Flemish Public Employment Service) was extended to the group of the newly unemployed between the ages of 50 and 52 years. This approach means that these unemployed are required to seek assistance to find a new job after three months of unemployment. In so doing they can rely on various instruments, such as participation in a 50+ club and other types of support for finding a job, education programs, etc. They are also assisted by consultants who only work with jobseekers aged 50 or older and who also can take into account the specific issues of this target group. This study examines whether this measure has had an impact on the career opportunities of this target group. In isolating this impact we used the fact that the introduction of the measure is based on an age criterion (50-52 years) and on a calendar criterion (from May 2009 onwards). The conclusion is that the measure has increased the transition to employment in this target group by 3 to 4 percentage points, which, in view of the relatively low chances of outflow to employment of jobseekers aged 50 or older, is considerable. Moreover there are also indications that not all the unemployed in this target group have effectively made use of this measure in spite of the mandatory nature of this measure. This suggests that the impact for those who did take part is potentially deemed even higher than was estimated.
Key words: Active labour market policy; older unemployed; difference in differences; propensity score matching;
2.
Study objectives
In view of the demographic trends it is very important that a sufficiently high employment rate is maintained in the category of the over-50s. This is more particularly an issue in the Flemish labour market, which is characterised by a very low employment rate in this age group. This can be remediated first and foremost by ensuring that the necessary regulations and conditions are in place to encourage older employees to work longer and to encourage employers to keep older employees on board longer. One must then subsequently ensure that the over 50s who do indeed become unemployed can rely on adapted tools to help them find a job again. These include the tools of the active labour market policy, which can be adapted where necessary to this age group’s specific issues and needs. In spite of the fact that there is a lot of information about the effectiveness of various active labour measures in general, there is not much information about the impact of measures that specifically target older jobseekers. In addition, in those cases where we can say something about the relation between effectiveness and age, based on literature, this usually relates to older jobseekers who elected to make use of the measure themselves, and which in all probability form a selective, non-representative group. The measure studied here is quite important in this respect, not only because it involves tools that have been adapted in function of the age group (to a certain extent, among others by using specific consultants) but because anyone who falls under these conditions is supposed to take advantage of the measure. The aim of the study was to verify whether the introduction of this new policy has had an impact on the job opportunities of this target group.
3.
Methods and data
We explain here in five steps how the measure’s impact was determined. (1) Firstly, the group of all the jobseekers in the age group (50≤ age < 53) who were eligible for the measure since the start of the extended systematic approach was selected. This is called the target group hereinafter. The labour market trajectory of these people was then monitored on a monthly basis, from the instant that they exceeded the threemonth period of unemployment (from this time onwards they were eligible for the measure) for a seven-month period (meaning until the tenth month after they became unemployed). Every month we verified whether or not they were working. It is then possible to calculate the proportion of this group that is employed for a seven-month period. (2) Subsequently the employment results of the target group were compared with the employment results of a group of jobseekers in the 50-52 age group, who became unemployed in the same months as the target group, albeit in 2008
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